Trade blockages ease, but recession seems to be looming, say economists
At the same time as congestion in some ports begins to ease and goods get ...
Vietnam’s state-controlled shipping group, Vietnam Maritime Corp (VIMC), plans to acquire more containerships and build more inland box depots in a bid to boost its competitiveness.
The group aims to acquire four box ships ranging from 1,700 to 2,200 teu this year, bringing its fleet of 12, for around 9,000 teu, to at least 13,000 teu, accounting for 30% of all Vietnamese-owned container vessels.
Last year, VIMC’s net profit fell 23% year on year, to VND2.54trn ($107.5m), as operating costs surged amid inflation. Director general Nguyen Canh Tinh, expecting a more challenging market, has reduced this year’s profit target by 24% of the 2022 figure.
VIMC is hoping to work with investors to develop the inland container depots and distribution and logistics centres in areas such as Haiphong, Hanoi, Danang, Quy Nhon and Ho Chi Minh City.
It said the strategy reflected the Vietnamese government’s desire to carry more of the country’s exports of manufactured and semi-finished goods on locally owned ships, as the country continues to draw manufacturers away from China.
According to business network Tradeshift’s Q1 23 report, trade activity in Vietnam grew at five times that of rivals in the past year, as “businesses realised the drawbacks of concentrating manufacturing activity in China”, following Covid-related lockdowns and Sino-US geopolitical tension.
In December 2022, technology giant Apple announced it would move production out of China and would increase product assembly, especially in Vietnam and India.
Meanwhile, an EU Chamber of Commerce survey showed 23% of Western businesses are moving operations out of China.
However, market watchers have told The Loadstar that, while Vietnam may want more exports carried on locally owned ships, those fleets are small and cannot compete with the mainline operators. VIMC’s fleet has an average age of 22 years and needs more modern vessels.
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